Citigroup aims to reduce its global workforce by 20,000 jobs, which constitutes approximately 10% of the total staff, within the next two years. This move is part of the company’s effort to make its operations more efficient.

Citi Group Plans to Cut Over 20,000 Jobs in Two Years
Citi Group Plans to Cut Over 20,000 Jobs in Two Years

Citi Group Plans to Cut Over 20,000 Jobs in Two Years

The job cuts are a component of a broad reorganisation that CEO Jane Fraser unveiled last year. The British-born executive, who assumed leadership in 2021, has described 2024 as a crucial moment for the company. Citigroup has already divested certain international operations and has taken steps to list its Mexican unit as an independent entity.

The Restructuring Aims to Remove Layers of Bureaucracy

Last year’s announced restructuring aims to remove layers of bureaucracy within the bank by reducing overseas regional management layers and cutting certain units. Despite a significant $1.8 billion (£1.4 billion) loss in the last quarter of 2023, the largest quarterly setback reported by the lender in years, CEO Ms. Fraser noted progress in the bank’s strategy.

“Given the advancements in our simplification and divestment efforts, 2024 is poised to be a turning point,” stated Ms. Fraser.

Citi, with over 16,000 employees in the UK, did not provide specific details on how many job losses might affect the UK or which units would be most impacted. However, as the plans unfold, they will substantially reduce the bank’s overall size.

The Bank Plans to Cut down from 240,000 to 180,000

Chief Financial Officer Mark Mason stated that the bank anticipates having approximately 180,000 employees by 2025 or 2026, a reduction from the approximately 240,000 employees at the beginning of 2023. The reorganisation is projected to incur costs of up to $1 billion this year alone, in addition to the $800 million in the most recent quarter. However, it is expected to generate savings of $2.5 billion over the medium term.

As one of the five largest banks in the US, Citi has faced investor pressure to enhance its performance, as its profits have trailed behind its peers. The bank has also encountered regulatory issues, including fines related to money-laundering controls in previous years.

Citi attributed the recent quarter’s loss to one-time factors such as the devaluation of the Argentine peso and a special fee imposed by the government on US banks to bolster its deposit fund following several failures last year.

While the full-year revenue increased by 4% from 2022 to $78.5 billion, profits experienced a significant decline of 38% to $9.2 billion.

In contrast, close competitor Wells Fargo reported an 11% growth in revenue to $82.5 billion last year, with profits surging approximately 40%. Meanwhile, at JP Morgan, revenue experienced a 23% increase to over $158 billion, and profits saw a jump of about 30%.

Citi’s shares declined by 1.4% on Friday.

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By Dee

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